Do I qualify for the Canada Child Benefit?

February 4, 2021

Diapers, sleepless nights, and miniature everything became part of your life recently. Or, maybe your family is expecting a new addition and you’re getting all your soon-to-be rubber ducks in a row. Either way, you’re probably wondering if you qualify for the Canada Child Benefit (CCB). This benefit is a tax-free monthly payment from the federal government. It’s paid to eligible families to help with the cost of raising children, depending on their household income.

How much CCB will I get?

To determine your CCB amount, the Canada Revenue Agency (CRA) looks at factors like the number of children who live with you, their ages, if they qualify for the child disability amount, and your adjusted family net income.

Because we can all use some extra help this year, four additional payments will also be made to eligible families with children under the age of 6 in 2021. This includes:

  • $300 per child for families with a net income of $120,000 or less, and
  • $150 per child for families with a net income of more than $120,000

Will I receive CCB payments?

In order to be eligible to receive the CCB, families need to meet these conditions:

  • You need to live with the child, and the child must be under the age of 18
  • You need to be primarily responsible for the care and upbringing of the child
  • You have to be a resident of Canada
  • At least one parent/spouse/common-law partner must be a Canadian citizen, permanent resident, protected person, or temporary resident who has lived in Canada for the past 18 months

I had a baby but didn’t file my return this year. Will I receive CCB payments?

The CRA calculates eligibility in July, and it’s based on information that comes from your tax return. In order to qualify for CCB payments, parents need to file their returns every year to start or continue receiving benefits. If an eligible parent doesn’t file their return, even if they have no income to report, the CRA can’t calculate the correct CCB amount so payments will stop coming in August.

I filed my return late in the year. Will I still receive payments?

Once both parents file a return, CCB payments will not only start again, they’ll also be retroactive. This means you should receive your payments for any months that were missed. If you start or stop sharing custody of your child with their other parent, make sure you tell the CRA as soon as possible as it will affect your payments.

What can I use CCB payments for?

The CCB is meant for your child, but since they are minors, the CRA is trusting you as their parent to spend it where your child needs it most. Most families use their payments as part of their budget for things like clothing, school supplies, and food.

Can I save CCB payments for my child? Will they pay taxes on it?

If you receive the CCB payment by direct deposit, you can then direct it to an account in your child’s name, and any interest or dividends earned would be reported by them when they’re old enough to start filing tax returns. Most of the time, the money earned by the CCB payments will be less than the basic personal amount and will be tax-free (unless your child is employed).

If you receive CCB payments in your account first and then transfer it to your child’s, it would still be considered your income and your child won’t be taxed on it.

I have an outstanding tax bill. Will my CCB payments be automatically deducted?

If you happen to owe the CRA some money, your CCB payments won’t be deducted or used towards your bill. This payment is in place to help you with the immediate costs of raising your child, and won’t automatically be used to pay down your debt. You’ll continue to receive payments as long as you file your return by the deadline, even if you have an outstanding tax bill.

I’m not receiving CCB payments, but I think I should be. What should I do?

Apply as soon as possible! You should apply for the CCB payments soon after your child is born, or as soon as you become your child’s primary caregiver, so that you don’t miss out on any payments.

You can apply for the CCB by using the Automated Benefits Application, signing up through the CRA’s My Account feature, or by mailing a completed form RC66: Canada child benefits application.

You can also visit the CRA website for more information about the Canada Child Benefit.

Life with a little one means expecting the unexpected, but making sure your paperwork is up-to-date with CRA will help make sure you’re getting the tax credits and deductions you’re eligible for.

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